The ministry of international trade and industry (MITI) has said it will meet with the Malaysian Automotive Association (MAA) next week to discuss on matters regarding vehicle price approvals and the ILP (Industrial Linkage Programme) applications. The latter pertains to incentives and duty exemptions that are taken into consideration when OEMs price their vehicles.
UPDATE: This article has been updated to include a statement by MITI on the vehicle price approval dated January 17, 2018.
This was confirmed by Ong Kian Ming, who is the deputy minister of international trade and industry, at a briefing session organised by the Malaysia Automotive, Robotics and IoT Institute (MARii) today.
“All these incentive applications will go through the ABDC (Automotive Business Development Committee) and this is one of the issues that have been brought up by MAA in terms of causing some delays in the releasing of the pricing of the cars,” said Ong.
“It’s important to clarify and to show the importance of the ABDC as a central focal point where all the different incentives that are being applied by the car manufacturers and OEMs can be proceed and the recommendations from ABDC can then be forwarded onto the ministry of finance to decide on the level of excise tax that can be adjusted or reduced,” he added.
Ong also explained the importance of the ILP and why it must go through the ABDC, stating that if car manufacturers want to obtain a higher exemption on excise tax, MITI would want to know what they can bring into the economy in terms of manufacturing activities as well as energy efficient/saving technology.
As MITI explains, the purpose of the ABDC is to evaluate and recommend the Industrial Linkage Program (ILP), Multi Sourcing Parts (MSP) and customised incentives for Energy Efficient Vehicle (EEV) under the National Automotive Policy (NAP) 2014. The recommendations by ABDC are for the consideration of the finance ministry when it comes to deciding the amount of duty reduction that will be extended to the vehicle companies.
“Let’s say if you get a higher exemption for excise tax, obviously we would want to see some of these cost savings be passed down to the consumers, so that people can have access to more affordable cars,” Ong noted.
The planned meeting will not only involve MITI and MAA, but also relevant stakeholders like car manufacturers and OEMs. Following this, the decisions and agreements that arise from this meeting will be announced to the press.
The issue of delayed vehicle price approvals has been affecting car companies in Malaysia for several months, as revealed by the Malaysian Automotive Association (MAA) earlier this week.
During a briefing session, MAA president Datuk Aishah Ahmad revealed that the association was going to seek a meeting with MITI to discuss the matter.
A response on the vehicle price approval was issued by MITI on January 17, providing some background on ABDC, which has been around since 2006. The committee consists of representatives from MITI, the finance ministry, the Malaysia Investment Development Authority (MIDA), MARii and the Royal Malaysian Customs Department (RMCD).
In its statement, MITI said “in the previous administration, some vehicle companies had obtained the incentives directly from the finance ministry, bypassing ABDC. Many of the applications were approved without comprehensive evaluation in determining the return of investment to the government.”
“However, in line with the aspiration of the new government, the finance ministry and MITI collectively agreed that the decision making process has to be transparent and fair and should be comprehensively deliberated by ABDC,” it continued. Meetings held by ABDC are on a monthly basis and special meetings will be convened, if necessary.
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Don’t talk crap la, if car price increase next election then you know….now all dealer said government want higher car price and remove eev and hybrid incentive, moron
Tax all foreign brand cars like proposed ,
under 1.3cc – Rm47K
1.3 to 1.6cc – Rm67k
1.6 to 2.0cc – Rm87k
2.0 to 3.0cc – Rm117k
above 3.0cc – Rm147k.
Malaysia is the only country in the world where car companies must get approval to sell.
Just allow car companies to sell whatever price they want. Why control them? Until today, still want to protect Proton.
I used to work for ETCM before. ETCM wanted to sell the Nissan Slyphy for RM80k. But Government say NO. They say must be above RM100k
The problem lies with the fact that the Government themselves own all car companies in Malaysia and want to untung lebih at the expense of the rakyat.
UMW is a GLC and they own Toyota. Honda is owned by GLC DRB. PRoton DRB, Ford Sime. BMW Sime, Hyundai Sime
So Government overcharges the rakyat, Government untung lebih. This is ridiculous.
Government should be neutral and always fight for the rakyat to get the cheapest deals always
Problem#1: Gomen only tax, and should not control & approved the car pricing. Problem#2: Tax rate no standardized across car makers, even meet same requirement, no fair policy, damage local automotive industry.
This is the flip flop that drove all investors away to Thailand.
In the 80s, Malaysia was the Detroit of Asia and every car company wanted to CKD in Malaysia. But because of such flip flops and relax and lepak attitude in making quick and prompt decisions, all lari to Thailand to make Thailand the Detroit of Asia
Today, Thailand can make decisions fast. No need 9 months. Within 2 days can make decision.
This is because Thai people only need to sit once in a meeting to make decisions on pricing.
In Malaysia we need 20X meetings.
Too inefficient. Go to Thailand and see how they do things fast. Malaysian Government need to send Rombongan Sambil Belajar to Thailand to see how they do things fast.
MAA, MITI and MAI need to go to Thailand to see how to work fast and make prompt decisions.
Then hopefully, one day, car companies in Thailand may relocate back to Malaysia
The problem in Malaysia, any meeting is all about eating karipap, kuih lapis and minum teh. Nothing much is discussed.
Before any decisions are made, already majlis bersurai. Then it repeats until 20 meetings are over
They dare do it now cuz by next election, MY pipu sudah lupa….
Why so damn many comittee and departments, all replicating each oter functions? Get the job done fast la dunt play2 or we vote u out
Dear Mr. Govt, You must decide faster la, your decisions has impact on the economy, if you must meet on the weekends and beyond office hours do it la. Kasi cepat kerja!!!
They are darn bloody slow…typical government mentality. Trying how to tax the people as high as possible and delay them from getting their cars before CNY. Meeting once a month only? Crap…
Aiyah, MITI again. Knock head on wall.
a subaru XV was around 119 – 125k last year, and today subaru official website states that the price for xv is 130 – 137k
CX 3 was 121k back in Aug 2018, and now it is 128k
Civic 1.5 TC was around 121k in Oct 2018, yesterday Honda website provides that the price for civic is to be confirmed.
any reason for these hikes / uncertainties?
Need to fund Atuks reinvigorated cronies that had supported him during GE14.
Careful G. Wrong mistake into car price will ruined you. Malaysian very sensitive towards car pricing. What you promise during campaign before election is a promise. Don’t BS us. There are many BS appear since new G take over.
Hmmmm…planning to increase the price??
Mahathir did not agree with Najib’s decision to sell Proton, he wants Najib to increase car taxes to support Proton, and also he wants Najib to pump in more billions for R&D.
Car price is not coming down, Mahathir wasnt higher tax to support his new 3rd national car. This means a new Carbon Tax to support his new electric car.
After ABCDE they will another new committee after this, FGHIJ. TQ.
Remove excise tax immediately! this is what Rakyat wants!
PH if not careful, rakyat will vote you out and then Najib back in power.
Already manifesto not fulfilled. Main main kah??